Limited Brands Reports Third Quarter 2012 Earnings -- Provides Fourth Quarter And Raises Full Year 2012 Earnings Guidance -- -- Authorizes $250 Million Share Repurchase Program -- -- Declares Regular Quarterly Dividend -- PR Newswire COLUMBUS, Ohio, Nov. 14, 2012 COLUMBUS, Ohio, Nov. 14, 2012 /PRNewswire/ --Limited Brands, Inc. (NYSE: LTD) today reported 2012 third quarter results and increased its 2012 full-year earnings guidance. (Logo: http://photos.prnewswire.com/prnh/20020520/CLM001LOGO ) Third Quarter Results Adjusted earnings per share for the third quarter ended Oct. 27, 2012 were $0.26 compared to $0.25 for the third quarter ended Oct. 29, 2011. 2011 earnings per share included approximately $0.03 attributable to the third party apparel sourcing business, which was sold in November 2011. Excluding this amount from last year, adjusted earnings per share increased 18%. Adjusted third quarter operating income was $197.4 million compared to operating income of $186.1 million last year, and adjusted net income was $75.6 million compared to $77.6 million last year. Adjusted results exclude certain significant items as detailed below: oIn 2012 (totaling to a charge of $0.01 per share): oA pre-tax charge of $10.4 million, or $0.04 per share, related to La Senza store closures which were previously announced; and oA pre-tax gain of $12.7 million, or $0.03 per share, from cash distributions related to the company's Easton investments. oIn 2011: oAn income tax benefit, primarily due to the resolution of certain tax matters, of $16.7 million, or $0.06 per share. Including the significant items above, reported third quarter earnings per share were $0.25 compared to $0.31 last year; operating income was $186.9 million compared to $186.1 million last year; and net income was $73.4 million compared to $94.3 million last year. The company reported a comparable store sales increase of 5 percent for the third quarter ended Oct. 27, 2012, compared to the third quarter ended Oct. 29, 2011. The company reported net sales of $2.050 billion for the third quarter ended Oct. 27, 2012, compared to net sales of $2.173 billion last year. Third quarter 2011 net sales included $258.7 million attributable to the third party apparel sourcing business, which was sold in November 2011. At the conclusion of this press release is a reconciliation of reported to adjusted results. 2012 Outlook The company stated that it expects fourth quarter earnings of $1.62 to $1.77 per share. For 2012, the company increased its adjusted earnings per share forecast to $2.78 to $2.93. Share Repurchase Program and Regular Quarterly Dividend The company's board of directors has authorized a $250 million share repurchase program, which includes $49.6 million remaining under the previous $500 million program. The company said it may repurchase shares from time to time in the open market or through privately negotiated transactions, depending on prevailing market conditions, alternative uses of capital and other factors. The company also declared its regular quarterly dividend of $0.25 per share payable on Dec. 10, 2012 to shareholders of record at the close of business on Nov. 26, 2012. Earnings Call Information Limited Brands will conduct its third quarter earnings call at 9 a.m. Eastern time on Thursday, Nov. 15. To listen, call 1-866-583-6618 (international dial-in number: 1-937-200-3978). For an audio replay, call 1-866-NEWS-LTD (international replay number: 1-706-902-3452) or log onto www.Limitedbrands.com. Additional third quarter financial information is also available at www.Limitedbrands.com. ABOUT LIMITED BRANDS: Limited Brands, through Victoria's Secret, Pink, Bath & Body Works, La Senza and Henri Bendel, is an international company. The company operates 2,626 specialty stores in the United States and its brands are sold in more than 700 company-operated and franchised additional locations world-wide. The company's products are also available online at www.VictoriasSecret.com, www.BathandBodyWorks.com, www.HenriBendel.com and www.LaSenza.com. Limited Brands b-roll footage of stores is available through our online newsroom. Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 Limited Brands, Inc. cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this press release or the third quarter earnings call involve risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. Accordingly, our future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. Words such as "estimate," "project," "plan," "believe," "expect," "anticipate," "intend," "planned," "potential" and any similar expressions may identify forward-looking statements. Risks associated with the following factors, among others, in some cases have affected and in the future could affect our financial performance and actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements included in this press release or the third quarter earnings call: ogeneral economic conditions, consumer confidence, consumer spending patterns and market disruptions including severe weather conditions, natural disasters, health hazards, terrorist activities, financial crises, political crises or other major events, or the prospect of these events; othe seasonality of our business; othe dependence on a high volume of mall traffic and the possible lack of availability of suitable store locations on appropriate terms; oour ability to grow through new store openings and existing store remodels and expansions; oour ability to successfully expand into international markets and related risks; oour independent licensees and franchisees; oour direct channel business; oour failure to protect our reputation and our brand images; oour failure to protect our trade names, trademarks and patents; othe highly competitive nature of the retail industry generally and the segments in which we operate particularly; oconsumer acceptance of our products and our ability to keep up with fashion trends, develop new merchandise and launch new product lines successfully; oour reliance on foreign sources of production, including risks related to: opolitical instability; oduties, taxes and other charges on imports; olegal and regulatory matters; ovolatility in currency exchange rates; olocal business practices and political issues; opotential delays or disruptions in shipping and related pricing impacts; othe disruption of imports by labor disputes; and ochanging expectations regarding product safety due to new legislation; ostock price volatility; oour failure to maintain our credit rating; oour ability to service our debt; oour ability to retain key personnel; oour ability to attract, develop and retain qualified employees and manage labor costs; othe inability of our manufacturers to deliver products in a timely manner and meet quality standards; ofluctuations in product input costs; ofluctuations in energy costs; oincreases in the costs of mailing, paper and printing; oclaims arising from our self-insurance; oour ability to implement and maintain information technology systems; oour failure to comply with regulatory requirements; otax matters; and olegal and compliance matters. We are not under any obligation and do not intend to make publicly available any update or other revisions to any of the forward-looking statements contained in this press release or the third quarter earnings call to reflect circumstances existing after the date of this press release or to reflect the occurrence of future events even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized. Additional information regarding these and other factors can be found in "Item 1A. Risk Factors" in our 2011 Annual Report on Form 10-K. LIMITED BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME THIRTEEN WEEKS ENDED OCTOBER 27, 2012 AND OCTOBER 29, 2011 (Unaudited) (In thousands except per share amounts) 2012 2011 Reported Adjustments Adjusted Reported Adjustments Adjusted Net Sales $ $ $ $ $ $ 2,050,189 - 2,050,189 2,173,420 - 2,173,420 Cost of Goods Sold, Buying & (1,225,063) 10,437 (1,214,626) (1,388,143) - (1,388,143) Occupancy Gross Profit 825,126 10,437 835,563 785,277 - 785,277 General, Administrative and Store Operating (638,178) (638,178) (599,175) (599,175) Expenses Operating 186,948 10,437 197,385 186,102 - 186,102 Income Interest (77,155) - (77,155) (63,860) - (63,860) Expense Other (Loss) 17,603 (12,745) 4,858 (368) (368) Income Income Before 127,396 (2,308) 125,088 121,874 - 121,874 Income Taxes Provision for 54,036 (4,588) 49,448 27,597 16,691 44,288 Income Taxes Net Income $ $ $ $ $ $ 73,360 2,280 75,640 94,277 (16,691) 77,586 Net Income Per $ $ $ $ Diluted Share 0.25 0.26 0.31 0.25 Weighted Average Shares 294,386 294,386 307,928 307,928 Outstanding See Notes to Consolidated Statements of Income and Reconciliation of Adjusted Results for additional information. LIMITED BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME THIRTY NINE WEEKS ENDED OCTOBER 27, 2012 AND OCTOBER 29, 2011 (Unaudited) (In thousands except per share amounts) 2012 2011 Reported Adjustments Adjusted Reported Adjustments Adjusted Net Sales $ $ $ $ $ $ 6,603,068 - 6,603,068 6,848,572 - 6,848,572 Cost of Goods Sold, Buying & (3,933,506) 13,237 (3,920,269) (4,319,469) - (4,319,469) Occupancy Gross Profit 2,669,562 13,237 2,682,799 2,529,103 - 2,529,103 General, Administrative and Store Operating (1,884,050) 800 (1,883,250) (1,932,645) 163,428 (1,769,217) Expenses Operating 785,512 14,037 799,549 596,458 163,428 759,886 Income Interest (234,473) - (234,473) (182,788) - (182,788) Expense Other (Loss) 19,041 (12,745) 6,296 232,868 (233,478) (610) Income Income Before 570,080 1,292 571,372 646,538 (70,050) 576,488 Income Taxes Provision for 228,513 (4,588) 223,925 155,897 62,456 218,353 Income Taxes Net Income $ $ $ $ $ $ 341,567 5,880 347,447 490,641 (132,506) 358,135 Net Income Per $ $ $ $ Diluted Share 1.15 1.17 1.55 1.13 Weighted Average Shares 297,218 297,218 317,067 317,067 Outstanding See Notes to Consolidated Statements of Income and Reconciliation of Adjusted Results for additional information. LIMITED BRANDS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED STATEMENTS OF INCOME AND RECONCILIATION OF ADJUSTED RESULTS (Unaudited) The "Adjusted Results" provided in the attached unaudited Consolidated Statements of Income and Reconciliation of Adjusted Results are non-GAAP financial measures and reflect the following: Fiscal 2012 In the third quarter of 2012, adjusted results exclude the following: o$10.4 million ($10.4 million net of tax) of store closure costs at La Senza. oA $12.7 million pre-tax gain ($8.2 million net of tax), included in other income, from $13.4 million of cash distributions related to the company's Easton investments. In the second quarter of 2012, adjusted results exclude the following: o$3.6 million ($3.6 million net of tax) of store closure costs at La Senza. In the first quarter of 2012, there were no adjustments to results. Fiscal 2011 In the third quarter of 2011, adjusted results exclude the following: oA $16.7 million tax benefit related to the favorable resolution of certain discrete income tax matters. In the second quarter of 2011, adjusted results exclude the following: oA $147.1 million non-taxable gain, included in other income and expense, and associated pre-tax expense of $113.4 million, included in general, administrative and store operating expenses, associated with our charitable contribution of Express, Inc. common stock to The Limited Brands Foundation. In the first quarter of 2011, adjusted results exclude the following: oAn $86.4 million pre-tax gain ($55.6 million net of tax), included in other income and expense, related to the sale of shares of Express, Inc. common stock. oA $50.0 million pre-tax expense ($31.2 million net of tax), included in general, administrative and store operating expenses, related to a pledge to The Limited Brands Foundation. oAn $11.0 million tax benefit primarily related to the favorable resolution of certain discrete income tax matters. The Unaudited Adjusted Consolidated Statements of Income should not be construed as an alternative to the reported results determined in accordance with generally accepted accounting principles. Further, the Company's definition of adjusted income information may differ from similarly titled measures used by other companies. While it is not possible to predict future results, management believes the adjusted information is useful for the assessment of the ongoing operations of the Company. The Unaudited Adjusted Consolidated Statements of Income should be read in conjunction with the Company's historical financial statements and notes thereto contained in the Company's quarterly reports on Form 10-Q and annual report on Form 10-K. SOURCE Limited Brands, Inc. Website: http://www.limitedbrands.com Contact: Limited Brands: Investor Relations, Amie Preston, +1-614-415-6704, firstname.lastname@example.org or Media Relations, Tammy Roberts Myers, +1-614-415-7072, email@example.com
Limited Brands Reports Third Quarter 2012 Earnings
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